Live From Search Marketing Expo (SMX): How FTC Disclosure Rules Affect Bloggers

Oct 06, 2009 11:35 PM  By

New York–Giving bloggers swag or cash to endorse your product? Beginning Dec. 1, the bloggers will need to be up front about the relationship.

The Federal Trade Commission has approved final revisions to guides concerning the use of endorsements and testimonials in advertising, which address endorsements by consumers, experts, organizations, and celebrities, as well as the disclosure of important connections between advertisers and endorsers. The guides were last updated in 1980.

Bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. The revised guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement.

“We were expecting this [from the FTC] and have had guidelines in place to on what to do, when they are blogging, to disclose their relationship,” Emilio Amodei, founder of BlogVertise, said during a session at Search Marketing Expo East here on Oct. 6.

Good news for the merchant or the product-pusher though: If a blogger breaks the rules, the blogger has to pay the fine, which could be upwards of $11,000 per offense, according to Amodei. BlogVertise acts as a middle man between product-pushers and bloggers who subscribe to the service.

But Amodei says he is not sure how the FTC is going to enforce the new rule, and thinks the logistics could get tricky. “Let’s say it’s a foreign blogger,” Amodei said. “They’re not going to go to India and fine someone for not disclosing a relationship.”

Coincidentally, Amodei said his U.S.-based business has plans to grow overseas next year, in places such as Asia, Germany, Italy and France.